As a result of legislation passed in 2020, the Australian innovation patent is currently being phased out. The critical date is fast approaching: Wednesday 25 August 2021. After this date, an innovation patent application will be not be allowed if it is a first application for an invention, or even if it is a second application claiming priority to a provisional application.

Why the change?

1.     The ease with which innovation patents, which have an 8 year term, pass through examination. They need only meet the innovative step test, which is satisfied where the claimed invention includes a difference over the prior art that makes a ‘substantial contribution’ to the way the invention works, whether or not that difference provides any benefit or improvement over the prior art (indeed, the innovative step may be met even where the claimed difference makes the invention inferior to the prior art). By contrast, the inventive step test for standard patents, which have 20 year term, is much more difficult to satisfy.

2.     The flip side to the above is that the innovation patent is an unusually strong species of patent, in that it is difficult to invalidate because it is hard to argue that the innovative step test is not met.

3.     The innovation patent is used by patentees as a litigation tool to make it hard for competitors to avoid or counterclaim against patent infringement. As these patents become enforceable very quickly, and are commonly filed in series as part of sharp litigation practice, sometimes more than 10 at a time, they make life very difficult for opponents. Also, the remedies available for infringement of an innovation patent are just as broad as those for a standard patent. As result, some commentators have said that this provided an unfair advantage to larger entities that had more resources to effectively ‘swamp’ smaller competitors.

The changes in detail

There is some subtlety to the amending legislation and the changes to innovation patents revolve around the concept of the ‘date of the patent’ as defined in amended section 53 and section 65 of the Australian Patents Act 1990 (Cth), and associated amended regulations. Subject to some exceptions, the ‘date of the patent’ is generally the date on which the first complete (i.e. non-provisional) patent application was filed. In summary:

• No new first instance innovation patent applications will be able to be filed after 25 August 2021.

• Existing innovation patents filed on or before 25 August 2021 continue in force until their expiry.

• Divisional innovation patent applications may still be filed after 25 August 2021, provided that the parent application (which, notably, may be a PCT patent application) for the divisional was filed on or before 25 August 2021.

• A standard patent application may still be converted to an innovation patent application provided the standard patent application was filed on or before 25 August 2021.

• All innovation patents will expire by 26 August 2029.

Crucially, no extensions of time will be available for late filings of innovation patents.

What you need to do:

If you are have recently filed, or are planning to file, a first patent application for your invention then the deadline is important and must be considered as part of the filing strategy. The deadline is particularly important where you have recently filed a provisional patent application (i.e. in the 12 months before 25 August 2021), or you plan to file a provisional application in the period leading up to or after the deadline. It may also be relevant for applicants with existing pending standard patent applications, where there is new subject matter that is best protected by an innovation patent.

We therefore recommend a strategic review of patent rights, whether they be granted, pending or new, in order to effectively manage the upcoming changes.

If you require further advice, please contact one of our patent attorneys.